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Eye on tomorrow: the UK's next generation of innovators may be stunted if sector reforms have unintended consequences, critics say

The falling proportion of home students on postgraduate science courses could threaten the viability of entire disciplines, according to England's funding body, with science groups warning that the trend may damage the economy.

A report from the Higher Education Funding Council for England shows that the growth in international students taking up postgraduate places in science, technology, engineering and maths subjects is far outstripping that among their UK counterparts.

The statistics, published in a report, Strategically Important and Vulnerable Subjects, presented at Hefce's last board meeting in July, reveal that the number of international students studying taught postgraduate STEM courses has almost doubled in eight years. However, for home students the rise was just 1 per cent.

In mechanical engineering, international student numbers grew from 22 per cent of the total studying population in 2002-03 to 54 per cent in 2009-10.

The numbers of postgraduate research students in STEM courses followed a similar trend. There was a 23 per cent increase in the international student population between 2002-03 and 2009-10, while the number of home students fell by 2 per cent.

Hefce's report warns that the growth in international numbers was "so marked that any decrease in overseas postgraduate students could lead to concerns about the future viability of courses and the overall sustainability of these disciplines".

It also adds "there may be a risk in relation to the UK's future workforce given that many postgraduate students enter positions requiring advanced skills and expertise following their studies, including in universities and research organisations".

Matthew Harrison, director of education at the Royal Academy of Engineering, said that whereas the growth in international students should be welcomed, there was a threat to the UK's next generation of innovators in cutting-edge industries if home postgraduate numbers did not keep pace.

He said that as international students take their expertise back overseas, "we reduce our ability to innovate, set up companies and create high added value to sell abroad".

Hefce's findings fire the latest warning shots about STEM in universities and follow serious concerns that government reforms to teaching funding and student number control also threaten the viability of provision.

Last month, figures released by Hefce indicated that some science and engineering subjects had relatively low proportions of students with AAB grades or higher at A level compared with classroom-based subjects - suggesting that they could be at greater risk from open competition for students in 2012-13.

Meanwhile, STEM departments are also contemplating being left with just £1,500 per new student in 2012-13, on top of fees, to fund their courses - despite those courses being much more expensive to teach than classroom-based subjects.

Hefce itself warns in its report that it may have "insufficient funding or other policy tools to sustain strategically important provision in the manner expected by the government, by the sector and by the various subject representative bodies".

Professor Harrison warned that while the government was making the right noises about science, it risked undoing its work in ring-fencing the research budget through the "unintended consequences" of other policies.

The loss of even a small engineering department - many of which are operating on tight margins - could be catastrophic for a whole UK industry because they often lead research in a particular sub-discipline, he said.

"From a national strategic point of view we are reliant to some extent on universities sticking with some provision, even though it is marginally sustainable on cost. And that is a difficult position to be in when you are trying to build an economy more based on productive industry," Professor Harrison said.

Imran Khan, director of the Campaign for Science and Engineering, called for "a higher rate of funding for both undergraduate and postgraduate STEM subjects or the consequence could be a skills shortage".

However, Vince Cable, the business secretary, writing in this week's Times Higher Education, says the coalition's task was to preserve the "virtuous circle" that already existed in universities and "which will entice the smartest academics to our universities and pull in grants and investment so that technological and intellectual breakthroughs continue to occur in the UK rather than somewhere else".